Archive for November, 2008

Groser on Agenda

November 30th, 2008 at 4:21 pm by David Farrar

Just watching Trade Minister Tim Groser on Agenda, and it is nice to see someone who is so obviously an expert talk on their portfolio area. This isn’t always possible (or resirable) in every area, but likewise it is nice to have one of NZ’s top lawyers as Attroney-General, rather than a non-lawyer.

Later on Mark Unsworth from Saunders Unsworth talked about the new MPs, and opportunities for promotion. He was pretty complementary of the new MPs from both parties (as I have been also). But what I thought was most interesting was his words on the difference between Ministers in John Key’s Cabinet and Helen Clark’s. Unsworth said it won’t be three strikes and you’re out for Ministers, but more like one strike and you are out. And unlike Clark there won’t be a recycling of Ministers six months later by putting them back in, but once you are out, you stay out.

While I don’t think it will be quite as black and white as that, I do think that life will be very different for Ministers under John Key. Up until her final term, Clark had very few realistic options for promotion, so Ministers were safe. Key has a number of very competent and ambitious MPs in the 2005 intake who will be keen to be Ministers within the next term, and a fair few of the 2008 intake will be aiming to become Ministers in the second term (if there is one) if not before.

Goodnight Kiwi

November 30th, 2008 at 1:00 pm by David Farrar

Yay. The SST reports that Goodnight Kiwi returns tomorrow. The world is now as it should be.

Williams to resign this week

November 30th, 2008 at 10:46 am by David Farrar

The SST reports that Mike Williams will resign as Labour Party President this week. Sadly there is no word on whether he has resigned off all the Government boards Labour appointed him to.

He still claims no regrets over his attempted smear job of John Key:

Williams, who drew much criticism for his dash to Melbourne late in the election campaign to examine papers about National leader John Key, said he had no regrets about doing so.

The 13,000 pages of court documents turned out to contain nothing incriminating of Key.

“To use a metaphor, if you’re pinned down, somebody has to crawl out under the barbed wire,” Williams told the Sunday Star-Times. “I drew the short straw on that one and the chance of getting my arse shot off, and I did.” The allegations had to be checked out, he said.

It’s sad he still doesn’t realise his mistake. As Party President he never ever should have been flying to Melbourne and taking back 20 kgs of papers. There were scores of other people who could have been dispatched.

Merely being a party president for the party no longer in power, doesn’t mean one should have to immediately resign all your Government appointments. Normally they would be allowed to see their terms out.

But WIlliams tried to prove that the Prime Minister was NZ’s biggest fraudster. He personally drove and managed an attempted smear campaign. He even blogged about it as Batman. He sent copies of documents to journalists at their home addresses. Having done all that, how ca he expect to be trusted to govern any crown entity on behalf of the new Government?

If Williams will not proactively resign, the Government shoudl show some balls and write to him asking him to resign off all the Boards he is on.

Coddington on Film Commission

November 30th, 2008 at 10:31 am by David Farrar

Deborah Coddington takes aim at the Film Commission:

So far, so good, until you get down to a miserable failure, The Ferryman, into which the commission poured $6m of our money, and which we could safely guess has not been seen by one person, save those who made it and maybe their mums and aunties.

Not one theatre bought this movie. The commission says 16,000 people have seen The Ferryman, but look closely and you realise this is based on a DVD being rented 13 times and seen each time by 2.5 people (was the third person half-asleep?). …

We spent $6 million on a film that not a single theatre would show?

We know 1330 DVDs were sold, but there’s absolutely no evidence – aside from marketing director Lindsay Shelton’s back-of-the-envelope workings – they were watched by 16,000 people. Let’s be generous and presume these DVDs were sold as rentals, fetching a top price of $25 each. That’s a return of less than $10,000 on an investment of $6m.

Sounds like mroe scrutiny is needed indeed. What I’m surprised about isn’t that the Film Commission lost $6 million on a film, but that tis loss has received such scant coverage, before COddington highlighted it.

Ralston on a tough start

November 30th, 2008 at 10:24 am by David Farrar

Bill Ralston writes:

Message to John Key and his new Government: No pressure.

Well, just a global financial market collapse, a deepening recession, a growing deficit, a crisis meeting with many of the world’s top leaders, shrinking commodity prices and a body blow to our other big export earner – the tourist industry – from the British departure tax.

Throw in a major terror attack overseas to further destabilise the planet and the crash of the Air New Zealand airbus in Europe and you get the toughest start any Government here has had.

The recession especially is of grave concern. Previous recessions have been for less than a year, while this recession may last two or even more years.

Waitangi Day and Google Earth

November 29th, 2008 at 2:00 pm by David Farrar

Maori Television has a nifty idea for Waitangi Day:

New Zealand’s national indigenous broadcaster, Maori Television, is putting out the call for all New Zealanders to come home for Waitangi Day 2009 but forget the planes, trains and automobiles you would usually rely on. This year, the only travel required will be in a virtual sense.

The broadcaster has created its own layer on Google Earth to collect messages from anywhere in the world devoted to the question: ‘Where on Google Earth will you be on Waitangi Day?’

Pictures, videos and text can all be uploaded into the page – from Aotearoa-New Zealand and beyond – to appear on the specially-created layer as a pin on the spinning globe. Anyone can upload material, ranging from a simple text message to photos, via Google’s photo sharing service, Picasa, or for the more tech-savvy among us, videos via YouTube.

‘Where on Google Earth will you be on Waitangi Day?’ is the question but also the concept that will underpin the channel’s broadcast dedicated to New Zealand’s national day, Waitangi Day, on Friday February 6 2009. The most inspiring, fun and heart-warming messages will be played throughout Maori Television’s programme, KOTAHI TE RA: WAITANGI DAY 2009.

“For anyone who has ever been away from home on our national day – or even if you’re at home but feeling that tug of national pride – this is the chance to connect to something special,” says Maori Television chief executive Jim Mather. “We believe this is something new and unique for an indigenous broadcaster, or indeed any broadcaster, to connect with its people via the internet.”

The technology used is essentially a specially-created layer visible on Google Earth which allows New Zealanders, their friends and families all around the world to create a message and load it into the space, marked by a map pin. “The beauty of the concept is its simplicity,” says Mr Mather. “It is easy to use, people can be as interactive as their abilities allow. It is all about the feeling.”

To see the short demonstration, or if you want to post a message, go to and follow the Google Earth link. Google Earth can be downloaded at

Nice to see innovative thinking at Maori TV. They provide by far the best ANZAC Day coverage, and I suspect will do the same with Waitangi Day.

And hey we’ll have a Prime Minister next year who isn’t afraid to spend Waitangi Day at Waitangi!

British MP arrested for receiving leaked info

November 29th, 2008 at 10:49 am by David Farrar

A huge uproar has occurred in the United Kingdom with the Shadow Immigration Minister, Damian Green, arrested over his use of leaked information that embarrasses the Government.

David Davis, the former shadow home secretary, described the move as “somewhere between an astonishing error of judgment and judicial intimidation”.

“Damian Green was doing his job, he was holding the Government to account … None of [the documents] put the national intelligence, national security or international relations at risk,” Mr Davis said, “Yet we end up with a situation that is in some way reminiscent of Robert Mugabe’s Zimbabwe, with an opposition spokesman being arrested for nine hours. It is extraordinary, frankly.”

If the MP in question had broken into Whitehall and stole the documents, then one might have some cause for arrest. But all that has happened is he received leaked copies of government papers. A lot of MPs would be getting locked up on that basis.

Helen probably regrets she never got Howard to arrest Tony Ryall for his use of leaked information.

No Right Turn is appalled.

What will be interesting is what Ministers knew about the arrest in advance. The Police informed the Opposition Leader and the Speaker. It is impossible to believe the denials that neitehr the Home Secretary nor the Prime Minister were given a heads up. London Mayor Boris Johnson was told in advance and tried to talk them out of it.

Hypocrisy from the Greens

November 29th, 2008 at 10:09 am by David Farrar

Frog is complaining that National has ditched the panel that was set up by Labour and the Greens to get them state funding of political parties.

Labour appointed the panel, without any consultation with National. This was inappropriate. In fact Green co-leader Russel Norman blogged that he agreed with me such appointments should not just be made by the Government of the Day.

If you and you mates act in a blatant self serving partisan manner, don’t be surprised when the new Government doesn’t feel any need to respect those decisions.

Personally I am a fan of citizen’s juries having a role to play in electoral issues. But the experts panels that advise such juries must not be unilaterally selected by the Government of the Day. By doing so, you can almost guarantee the outcome – and that is what the Greens and Labour tried to do – set up a process that would introduce their cherished dream of full taxpayer funding.

A great game of football

November 29th, 2008 at 10:01 am by David Farrar

Thanks to the very good people at Westpac, I got to watch the Phoenix vs Melbourne football match at the Stadium last night.

Westpac have the best positioned corporate box in the ground. I guess when the stadium is named after your company, you get some perks! So it was a great view of the game. Mind you the hardcore fans down in the zone gave the game its spirit – they made enough noise for 30,000.

Melbourne scored the first goal around halfway through the first half. But literally just seconds later, the Phoenix scored to equalise. And a goal in the second half made it 2-1.

But the score didn’t reflect what a great game it had been. Both teams had periods where they dominated. There was some great passing and lots of action around the goals. It was one of those great matches to watch.

Watkins on McCully

November 29th, 2008 at 9:39 am by David Farrar

Tracy Watkins does a useful profile of Foreign Minister Murray McCully:

Mr McCully admits his new job was probably cause for a few quiet toasts within National’s ranks. “The prospect of me travelling overseas a great deal is very reassuring for many of my colleagues.”


But the foreign affairs portfolio also represents a deliberate decision to step away. “I make no secret about the fact that I’m keen to play a role in a major portfolio and to provide less room for media speculation of a negative character about my involvement in political management issues.

“I’ve attracted a rather ordinary press on that front from time to time and the opportunity to do something substantial and stand on my own feet is something I’m really looking forward to . . . I think if you’re fortunate to have some time in Parliament, the final phases of your role should see you usefully employed and using your experience.”

Is that a hint that this could be Mr McCully’s last hurrah – and a desire to leave on a high note?

For my 2c this is largely correct. Murray has been an MP for 21 years, and I think is very keen to be known as more than just the Dark Prince. Ironically enough Winston Peters wanted the same thing – I’m confident Murray will be more sucessful!

Armstrong on Goff

November 29th, 2008 at 9:11 am by David Farrar

John Armstrong looks at the road ahead for Phil Goff:

Some on the left will view Goff’s paying homage to that most iconic of Labour figures as an insult, given the former’s support for Sir Roger Douglas free-market policies during the tumultuous years of the Lange Government.

But the Labour Party which Goff inherits from Helen Clark and Michael Cullen is one since reforged in the spirit which fuelled Savage’s Government.

The Douglas era is now history. Goff has long since operated within the Clark-Cullen social democratic frame. He and his deputy, Annette King, may be from the more moderate (arguably more right) wing of the party. But it will be a surprise if there is much change in fundamentals under their command.

While Helen Clark remains an MP, Goff will make no changes. Goff is Leader because Clark allowed him to be. At the moment all the Labour MPs can do is rave about how wonderful Helen was and try and protect her legacy. When was the last time you heard a Labour MP rave about Phil Goff and how excited they are to have him as Leader?

The problem about making no fundamental changes, is that Labour may have little to campaign on. Unless they promise tax increases there is little spare money.

Being granted the full three years to turn things around will be seen as plenty of time for him to put Labour back in a winning position. He will therefore likely get just one shot at becoming prime minister.

If he gets even that. I certainly hope he does. I regard a Phil Goff led Labour Party as far more rational and sensible than the Clark led Labour. But the overall Labour Caucus leans heavily to the left – I only count eight MPs out of 43 as belonging to the more centrist bloc. So if in a year or so Goff is making no impact in the polls, they may get restless. The lack of an acceptable replacement though may save him.

The second thing that must happen is Labour must do some serious soul-searching about why it lost the election. That debate will start with a session at next week’s meeting of the Labour caucus, the first chance the party’s MPs have had collectively to analyse the reasons why Labour became so “disconnected” from voters that its share of support slumped from just over 41 per cent of the overall party vote to just under 34 per cent.

And that is a pretty big fall. In 1999 National only dropped 4%.

Some in Labour may be inclined to ptu the loss down to time for a change. And sure that was a factor. But if they overlook their bad calls on the EFA, Winston, the pledge card, cancelling tax cuts, law & order, Section 59 – then they won’t have learnt.

The words of Gordon Copeland

November 28th, 2008 at 3:25 pm by David Farrar

Not many people know that Gordon Copeland has written an autobiography. Even fewer have actually read the autobiography. One hearty soul has been kind enough to read it, and also send to a few people selected extracts. Kiwiblog is proud to share these with the world, for your enjoyment:

First we have Chapter 12 on fighting Satan in Bangkok:

Jetlag does funny thing and I was wide awake in prayer at about 4am one morning in London when the Lord told me that Satan would attack me in Bangkok on the way home.

I had forgotten all about that a couple of days later when I was lying back in 40 degree Celsius heat alongside the swimming pool at the Oriental Hotel in Bangkok enjoying the sunshine. A beautiful girl stripped off topless alongside me and covered herself in suntan lotion before diving in for a swim. She was very much in my thoughts about 20 minutes later when I went back to my hotel room for a much needed nap.

Somewhere between the bedroom and the bathroom, I was physically attacked by an invisible spiritual being. I felt I was being strangled but strangely felt very little fear. The Lord’s warning to me in London suddenly flashed into my mind. I realised that I had been attacked by an unseen spiritual being from the realm of Satan. I am no stranger to demons and have many times, in ministering to people, found it necessary to rebuke spiritual beings in the name of Jesus Christ. The problem was that on this occasion I was incapable of speaking since my voice box appeared to be completely choked off. Inwardly, however, my spirit cried out desperately to God, “Help me!” From within the deep resources of my being a wave of the Holy Spirit rose up through my body and seemed to explode up through my throat and my mouth in a song, from my boyhood days of praise to God. I felt the spiritual being which had me in its grip loose me and leave. I was overcome with joy and went on singing my praise to God for several minutes. I didn’t even know that I still knew that particular hymn of praise!

Then in Chapter 3 we learn the secret to good forecasting for BP:

“In the 21 months I did the job my forecast of the month-by-month balance was never more than 3% away from the actual result. I was conscious week by week during 1974-75 of the Holy Spirit guiding my forecasts through one of the most turbulent periods in the history of the international oil industry.

Also how to gain clients in Chapter 13:

My office was was a desk in the corner of the lounge and, since I was unable to advertise, the best way to secure clients again seemed to be fervent prayer.

The love of goats:

The animal though, which provided us with the most joy was an un-neutered billygoat whom the children named “Gwillious”… Gwillious was, I think, just about the smelliest specimen of a goat ever to walk the planet Earth; was as strong as a bull and would butt anything that moved! In spite of that we were all immensely fond of him… Even now, it is difficult for us to take a drive in the country without Anne getting me to stop and admire the many goats which keep New Zealand’s roadway verges trim.

And finally resisting the attractiveness of females in Chapter 3:

“We all went off to a student party in Brooklyn run by some other ex-Kensington House boys and, against the trend, found ourselves short of girls. I gave those who were present a quick glance or two and decided that this particular evening should be devoted to beer and song. However, two or three beers and a couple of songs later it did seem to me that the attractiveness of the girls present had increased somewhat so I picked out the prettiest in the room and asked her for a dance. That proved to be a failry hilarious affair. Anne Davey (for that was her name) turned out to be a truly excellent dancer at both Rock and Roll and Twist, whereas my own efforts could only be described as pathetic.

“In typical student party style, Anne and I ended up, fairly late that evening, sittting in one of the bedrooms with half a dozen other couples, setting right the world’s problems. At one point in the conversation, Anne motioned towards a crucifix on the wall and asked me point blank whether I was Catholic. I gave a slightly too hurried and emphatic “No”, and she then calmly said to me, “Well, in that case, I bet you never thought you would be sitting here holding hands with a Catholic girl!” Her words hit me between the eyes and I almost dropped here hand there and then and invented an excuse to leave the room, but her sheer female attractiveness begged me to stay put.

Who knows what could have happened if he stayed put!

RIP Mike Minogue

November 28th, 2008 at 2:07 pm by David Farrar

NZPA reports:

Wellington, Nov 28 NZPA – Former Hamilton mayor and National MP Mike Minogue, known for going head-to-head with his leader Robert Muldoon, died early yesterday after a brief battle with cancer.

He was 85 years old. …

He represented the Hamilton West electorate until the 1984 election, when he lost his seat to Labour Party challenger Trevor Mallard.

Minogue was a good man.

Emma Daken

November 28th, 2008 at 12:41 pm by David Farrar

Emma Daken is doing something inspiring. Emma is a 20 year old student at Victoria University and she is spending all of November and December plus some of January walking from Cape Reinga to Bluff. Emma is doing it to raise money for research into a cure for cystic fibrosis. Almost every day she is walking the equivalent of a marathon.

Emma has already raised $12,000. She is giving up two months of her life to walk over 2000 kms to help this great cause. If you want to support her efforts you can easily make a donation online here. Her goal is to raise $50,000.

The Rodney Times has a photo and story about Emma’s walk.

You can also follow her walk on her blog. She is walking today from Eskdale to Hastings. Her entire schedule is on Facebook.


November 28th, 2008 at 11:26 am by David Farrar

An actress in South Korea is facing a possible 18 month jail term for adultery. Yes it a crime there.

Goodness knows how many years in jail the former Chief Constable of Greater Manchester would face, if they had the same law in the UK. An investigation has found he had affairs with 38 different women during his six years as Chief Constable!

I wonder if all the affairs were linear, or in other words did he have 38 affairs one after another or did he juggle perhaps up to half a dozen affairs at the same time? That would be quite challengin, let alone exhausting.

A flying start

November 28th, 2008 at 11:17 am by David Farrar

This week’s Dispatch from St Johnnsyberg looks at John Key’s flying start to the job. The grades are:

  • Best Play of the Week: Tim Groser gets an A for the expansion of the P4 trade agreement
  • Worst Play of the Week: Gordon Brown gets a D for the protectionist departure tax, which has nothing to do with climate change – that is just the excuse.
  • EFA Breach of the Week: Looks at the Electoral Commission ruling on whether Trevor Mallard broke the EFA by releasing leaked copies of National’s policies.
  • Scandals of the Week: The citizenship scandal continues as an A- while the immigration job offer scandal rises from a C to a B-

Feedback and comments welcome at NBR.

Five Kiwis presumed dead or air crash

November 28th, 2008 at 10:54 am by David Farrar

Very sad news emerging that there were five of the seven people on board the Air New Zealand A320 which crashed in the Mediterranean today were Kiwis. The plane was being operated by the German XL Airways who had leased it for the last two years.

By coincidence it is 29 years to the day since the Erebus crash.

The dead Kiwis (the authorities say no survivors are expected) are an Air NZ pilot, three engineers and a CAA Inspector.

It seems the air craft just fell out of the sky and dropped 300 metres out of the sjy into the sea, and sank to 45 metres.

My thoughts and condolences go out to Air NZ and CAA staff, plus friends and families of the five Kiwis. Also to the families of the German pilots who also perished.

General Debate 28 November 2008

November 28th, 2008 at 10:44 am by David Farrar

MPs now official

November 27th, 2008 at 8:53 pm by David Farrar

The Chief Electoral Officer has announced that as there have been no applications for judical recounts, he has returned the writ declaring the sucessful electorate MPs and the list MPs.

The MPs will be sworn in on Monday 8 December.

When do you start attributing things to the new Government

November 27th, 2008 at 11:39 am by David Farrar

NewZblog tries very lamely to blame National for the high migration in October 2008, arguing it should have reduced because National was ahead in the polls.

Now I think one doesn’t even have to try and respond to the lame attempt to blame National for migration figures that are for the month before the election. But it does raise the issue, when should you start holding a new Government accountable? Is it the Nov 2008 figures? Dec 2008?

A tend to to think 9 – 12 months is the usual lead in time you look for, to expect a Government to be “accountable” for various statistics. Accountable doesn’t mean they have a hell of a lot of control over them, but means that the country is now operating under the new policy settings.

Very few people or companies change behaviour just because a Government changes. Employers don’t go out the day after the election and start advertising new jobs they were holding off on. Expats don’t suddenly pack up their homes and get the next flight home.

What they do respond to, is policy changes. And generally it takes nine or more months to pass a law, and you have to wait until the budget in May next year for changes in government spending and taxation – and those changes may be spread over the next year or so also.

Another key thing to look for is what was the trend up until the change of Government, and did the trend then change? For example In 1990 unemployment was skyrocketing andat the end of the year National came into power. Unemployment kept increasing for nine months, and then it turned about and declined for the next five years. I blame the increase from Dec 1990 to Sep 1991 on the mess inherited from the former Government.

Some stats will not turn around for years and years, if at all. If you accept part of the solution to outwards migration is wage levels, and you also accept that the solution to wage levels is increased productivity growth, well it is a very long-term project to increase productivity growth. So at first what you might look out for is not a reversal in the trend, but even a slowing.

The other thing to look for is not just measuring actual vs actual, but actual vs projected. For example National will have a bigger deficit in next year’s budget than Cullen will have this year. The correct comparison to look at will be the size of the deficit compared to the projected deficit from the DEFU next month.

Wellington Water Meters

November 27th, 2008 at 11:00 am by David Farrar

The Dom Post reports:

Two of Wellington’s leaders are backing debate on a user-pays water system to reduce Wellingtonians’ reckless consumption – now more than twice the national average.

Wellingtonians each use 400 litres of water a day compared with Aucklanders’ 300 litres and a national average of 160 litres.

Of course water should be user pays. Food is.

International research showed charging people for the water they used could slash consumption by 20 to 40 per cent. This would ease pressure on the region’s water supply and delay the need to build a proposed $142-million dam for 20 years.

An excellent reasons to do it. This part was interesting:

  • Cleaning teeth – five litres per brush.
  • Shower: eight minutes under ordinary shower head – 120 litres. Eight minutes under water-efficient shower head – 80 litres.
  • Bath (full) – 200 litres.
  • Toilet half-flush – six litres.
  • Garden hose (on full) – 250 litres every five minutes.
  • Dishwasher – up to 25 litres a wash.
  • Washing machine: top loading – 100-200 litres. Front loading – 70-85 litres.
  • Dripping tap – 60,000 litres a year.

Kids Voting 2008

November 27th, 2008 at 9:29 am by David Farrar

Local Government NZ, along with NZ Post, ran a simulated election amongst secondary school students alongside the general election. This is a great civics initiative and 13,000 voted.

And those who want a smaller Parliament will be delighted with the results – a Parliament of only 107 MPs!

How is this possible? It is an obscure feature called underhang – the opposite of overhang. Let us look at the results:

  1. National 28.4%, 36 seats, 29 elects, 7 list
  2. Labour 25.0%, 32 seats, 16 elects, 16 list
  3. Bill and Ben Party 11.7%, 15 seats, 0 elects, 15 list
  4. Greens 11.2%, 14 seats, 0 elects, 14 list
  5. Legalise Cannabis 10.5%, 13 seats, 0 elects, 13 list
  6. Maori Party 4.9%, 6 seats, 6 elects, 0 list
  7. ACT 1.9%, 2 seats, 1 elect, 1 list
  8. NZF 1.0%, 1 seat, 1 elect, 0 list
  9. United Future 0.7%, 1 seat, 1 elect, 0 list

Now the Bill and Ben Party only had two candidates (Bill and Ben!) on their party list, so there would be an underhang of 13 MPs for a Parliament of 107. This means to form a Government you need 54 votes. So what would the Government be?

You could do National 36 + ALCP 13 + Maori 6 = 55

More likely is Labour 32 + Greens 14 + ALCP 13 = 59

The electorate seat won by NZ First was actually in Tamaki, so their sole MP would be a Doug Nabbs.

They have given results for each electorate also. Below are the seats where a different party would have won the electorate vote if the kids were the real electors:

  1. Auckland Central – Labour
  2. Bay of Plenty – Labour
  3. Dunedin North – National
  4. Invercargill – Labour
  5. New Lynn – National
  6. Rimutaka – National
  7. Tamaki – NZ First
  8. West Coast-Tasman – Labour
  9. Whanganui – Labour
  10. Wigram – National
  11. Ikaroa-Rawhiti – Maori

It is great to see the kids encouraged to take part in mock elections and vote. The results do show though why the Greens are bonkers with their campaign to lower the voting age to include 16 and 17 year old schoold students.

Disagreeing with Garth George

November 27th, 2008 at 8:19 am by David Farrar

Garth George says:

I have said it before and I say it again: The number one cause of abuse against women and children is abortion.

I disagree.

I think there would be less child abuse if there were more abortions.  The would would be a better place if those who are not suited to be parents did not become parents.

General Debate 27 November 2008

November 27th, 2008 at 8:14 am by David Farrar

Tertiary Fees Cap

November 27th, 2008 at 8:10 am by David Farrar

The Herald reports:

The New Zealand Vice-Chancellors’ Committee yesterday called on the National Government to view universities as national “infrastructure” that was in desperate need of investment.

The committee’s primary concern was that student financial support had been put ahead of university funding.

Victoria University vice-chancellor Pat Walsh said: “Put simply, the financial interests of students have been put ahead of the universities they attend.”

Th committee said the OECD average was for 82 per cent of government funding to be devoted to institutions and 18 per cent to student financial support. But in New Zealand 58 per cent went to institutions and 42 per cent to students.

The VCs are absolutely right. But you know they are a few years too late in complaining.

While in theory this would mean taking money from student’s allowances to give to the universities, University of Auckland chancellor Hugh Fletcher said “politically that’s not a reality, is it?”


Professor Walsh said its preferred outcome was to get $230 million to $250 million a year from Government to avoid a “zero-sum game scenario of institutions versus students.

The VCs get 0/10 for timing. I presume they have read headlines about a decade of deficits, the recession getting worse etc.

The Vice-Chancellors’ Committee said if universities were not going to get increased funding, it would need more money from fees – which is prevented for domestic students by the “fees maxima” cap.

It said New Zealand’s fees were on average cheaper than in Canada, Australia and the United States.

Education Minister Anne Tolley said National’s policy was to retain the fees maxima “so no doubt we’ll disappoint them [vice-chancellors] with that”. She said there were no great plans to change the proportion of funding to students and to universities either.

The cap on fees tertiary institutes can charge is basically a crap policy. National I suspect knows it is a crap policy but pledged to retain it as Labour would have scaremongered about higher fees if you vote National. We have an inherited legacy of bad public policy, and sadly National has ruled out sensible reform.

The motivation behind a fees cap is to keep pressure on universities to keep costs (esp staff wages) down. But this turns universities into a competition for the lowest common denominator and makes universoty councils fall guys for the Government, just as DHBs are.

The Government sets the level of government subsidy and the level of student fees, yet leaves it to the institutions to take the blame for not being able to increase wages etc.

I prefer to keep costs down in universities by that dreaded word competition. I would let universities price their courses to meet demand. Why shouldn’t Vic Uni be able to make a commerce degree more expensive than an arts degree?

And competition is not just on price, but on quality. A law degree at Vic should cost heaps more than a law degree from Waikato, as it is far more highly regarded. Students should have the choice of a cheap B class degree or a more expensive A class degree.

Now don’t get me wrong – I don’t actually want fees on average to be increasing. I’d still want incentives to keep fees down. Some of those incentives will be competition. But the other is putting the right people on university councils. The Government should get rid of price caps, but put people on Councils who will support efficency measures, and strove to keep fees low. But at the end of the day the individual universities need to be able to control both their income and expenditure and be held accountable for it. Taking away any say over income, and making them responsible for expenditure only is not a sustainable model.